Bahrain under emergency rule

Bahrain's king declared a three-month state of emergency on Tuesday as two died in fresh violence and Iran condemned an intervention by Saudi-led Gulf troops to help put down Shiite-led protests.

Thousands of protesters marched to the Saudi embassy chanting slogans against King Hamad and vowing to defend the country from the "occupation" forces, as unrest in the tiny country became a regional diplomatic crisis.

Bahrain recalled its ambassador to Tehran after the Iranian government condemned the arrival of Gulf Arab forces in the archipelago and defended the "legitimate" demands of pro-democracy protesters.

The financial district of Manama -- a regional banking hub -- was deserted for a third day except for anti-government protesters.

Shops and malls were shuttered and Sunni and Shiite vigilantes were in the streets in various parts of the capital and rural villages.

A Shiite protester and a member of the security forces were killed in separate incidents in the south of the archipelago, amid unconfirmed reports of bloody clashes outside of the capital.

The interior ministry also said a "group of vandals" had opened fire with automatic weapons on police patrols in the region of Buri, south of Manama. No injuries were reported.

In Manama, the protesters waved banners against the king as they marched to the Saudi embassy.

They also called for unity between Sunnis and Shiites in the mainly Shiite country, which has been ruled by a Sunni dynasty for more than 200 years.

Police and foreign forces were nowhere to be seen, witnesses said.

"We are ready to fall as martyrs for the sake of our homeland," said 17-year-old Nur Abdullah, who was wearing white to symbolise her readiness to sacrifice her life.

A 30-year-old man who gave his name as Ghazi said the troops who arrived from Saudi Arabia and the United Arab Emirates -- part of the Gulf countries joint Peninsula Shield Force -- were an army of occupation.

"The Peninsula Shield Force is supposed to be there to protect the countries of the Gulf and not to be used against the people," he said.

State television interrupted normal programming to announce a three-month state of emergency in the strategic Gulf state, which is home to the US Fifth Fleet and hosts major international banks and financial institutions.

"The Commander in Chief of the Bahrain Defence Force has been mandated to take the measures and procedures necessary to preserve the safety of the nation and its people," it said, adding "other forces" could also be used if necessary.

Armoured troops from Saudi Arabia and the United Arab Emirates had earlier rolled across the causeway from Saudi's Eastern Province to help Manama deal with pro-democracy protests which have shaken the kingdom for the past month.

Saudi Arabia's staunchly Sunni government said it had responded to a call for help from its neighbour under a mutual defence pact of the six-country Gulf Cooperation Council (GCC).

But Iran said the military intervention in a Shiite-majority country it has historic claims to was unacceptable.

"The people of Bahrain have demands, which are legitimate and are being expressed peacefully," foreign ministry spokesman Ramin Mehmanparast said.

"Any violence in response to these legitimate demands should be stopped."

Bahrain's state news agency said the kingdom had decided to "immediately recall" its ambassador in Tehran, as the country's crisis widened into a broader stand-off between Iran and the Gulf Arab states.

The United States warned Gulf states to respect the rights of the Bahraini people but said the entry of foreign troops was "not an invasion".

US Defense Secretary Robert Gates held talks with Bahrain's rulers in Manama on Saturday and urged them to undertake significant reform. He said there was no evidence that Iran was behind the unrest.

The European Union urged "utmost restraint" and called on Bahrain's security forces to respect "fundamental freedoms including the right to assemble freely and peacefully," a spokeswoman said.

Britain's embassy was closed until further notice, and the Foreign Office changed its advice to warn against all travel to the country.

A spokesman for British Prime Minister David Cameron said "governments should respond to calls for change with reform, not repression."

The United States and Australia have also urged citizens to avoid unnecessary travel to Bahrain and consider leaving the country.